What is the purpose of patents? To provide a temporary monopoly on an idea. The main problem is that an idea is just a tiny fraction of the work required to bring something to market. Why reward just this one aspect? The market does a great job at rewarding good products. You can have 20 companies all working off the same idea come up with 20 different products. The question is who gets to determine who gets rewarded? Should it be whoever can get the idea before a panel of experts or should it be the consumer in the market?
Also the duration of the monopoly in a patent system is fixed. In the market the first to market enjoys a temporary monopoly until competitors catch up. If you have a truly innovative product it may take a long time for people to catch up.
What fu(&ing country do you live in? In the US we do not own our bodies. My body, if I can even call it mine, is owned by politicians, my neighbors, doctors, and pharmaceutical companies. They all prohibit me from dealing freely with people regarding what I can do with or put in my body.
What scares me the most is all of the people replying to you that think they have the right to decide if your wife's life is worth an extra year or two. The beauty of a free market is that you get to decide if it is worth it. Not to sound crass but would you give up cars, houses, retirements, ect to spend another year with her? I know in my case I would. These people write that a year isn't worth the resources. Who the hell are they to decide? It's like all of these socialists governments that give free healthcare, 1950s technology of course, and then run to a modern country when they get sick. You know because they are important. Any politician promoting universal healthcare should should only get their and their families healthcare at the VA.
I always thought it would be better to combine life insurance and health insurance. That way the interests of you and the company are both the same, your well being. Right now as a 40 year old guy I am ten years into a twenty year term policy for a million dollars. You would think if I get cancer my life insurer wouldn't mind paying a couple hundred grand to make sure I make it to the end of my policy.
That was a good article. It didn't refute anything I wrote. It just expanded on it and gave more detail of the accounting. The problem its it didn't go into the meaning of the system. The system still is designed to steal wealth from people that are productive for the benefit of the politicians, bankers, and other connected people.
There was inflation in Spain when they took the gold from the new world and during the gold rushes. But at least the people that did the work or conquering are the ones that benefited not some banker that gets to create it by legal privlage.
That is part of it also there's are legal tender laws. Look at your bills. This debt is legal tender for all debts public and private. This means if you owe me money I have to accept dollars. I can't say you have to pay me in gold or silver. If I refuse your payment the debt Can be called off by a court.
This is a silly post. Remember spending bills originate in the House. Here is your list with Congressional Control
Regan +9.3% House Democrats Senate Democrats until 1981 Senate Republican 1981-1987
George H. W. Bush +13.0% House Democrats Senate Democrats
Clinton -0.07% House Democrats 1993-1994 House Republicans 1995-1997 Senate Democrats 1993-1994 Senate Republicans 1995-1997
Clinton -9.0% House Republicans 1997-2000 Senate Republicans 1997-2000
George H. Bush +7.1% House Republicans 2001-2004 Senate Democrats 2001-2002 Senate Republicans 2003-2004
George H. Bush +20.7% House Republican 2005-2006 House Democrat 2007-2008 Senate Republican 2005-2006 Senate Democrat 2007-2008
So it seems that the only time there was a real decrease was the Republican Revolution of 1994 when they were fighting Clinton. Once Bush was elected and they had full majorities they started spending again. More complicated and interesting than you claim.
Based on this post you have no idea what you are talking about.
You have to go back 50 years to before money was hijacked by our current system of theft.
Money was a store of value that was commonly used in exchange. That's it. Most of the world used precious metals for various reasons. Copper, Silver, Gold, ect. The reason is because it was valued by people and was a compact store of value. It came into existence by mining and coining.
You have to look at how much money is in existence vs all other goods. If the ratio of money to goods is increasing then the money becomes worth less and price go up and you have inflation. If the ratio of money to goods is decreasing than money becomes worth more and prices go down and you have deflation. The beauty of this system is that you have a natural mechanism to control the money supply. When you have deflation and money becomes more valuable people find it profitable to go into money making (ie mining and coining). When you have inflation people find it more profitable to make goods. This keeps things in balance.
This all changed when we left the gold and silver standards in the 60's and 70's. This allowed them to print money with nothing backing it. You then have had constant inflation and the destruction of the dollar. Most of the problems today are the result of this system. It is designed to steal the wealth of the people and transfer it to the powerful and it is working perfectly.
Most people think the way a bank works is they take money from depositors and lend it out and make money on the difference. Even if that were true it would be creating money because if the person saves money in a demand account (savings or checking) where they have access to it any time they want and the bank lends it out they have created money. Say I put $1000 in savings. My account shows I have $1000. Say the bank lends out $900 of it (Assuming there is a 10% reserve requirement which isn't even true anymore). There is now $1900 in the economy. It gets worse because when that person pays someone that $900 it goes into their bank and that bank can create $810. Now there is $2710 in the economy. This keeps going until there is $10,000. So the banks create $9,000 of money from that first $1000.
The key to this whole thing is letting banks lend out demand money. If we made this illegal the whole situation would change. Banks would only be allowed to lend out time deposits which are things like CD's where you give up access to the money for a certain time. This would prevent the bank from creating money because they could only lend out money that you don't have access to.
This could be accomplished without causing massive deflation by slowly raising reserve requirements.
The main reason deflation is bad is because today people have adjusted their lives based on debt and inflation. With deflation your wage goes down and you have problems paying off debts. But once transitioned to system where debt isn't money people do much better. You don't have to put your money at risk because you can just save it in a vault and it won't lose value. This I believe is why we have the current system. The powerful bankers and politicians like inflation because it allows them to spend money they don't have to tax to get. Also inflation forces you into the financial system so that your savings have a hope of maintaining purchasing power.
To think about deflation you have to look at the technology industry. This industry is growing so fast in productivity that it is still deflationary. Do people ever rush out to by a TV because they think it will be more expensive next year? Some people like the latest and greatest but most people wait for products to drop until they are in their price range. This is deflation. I bought an Apple II GS in 1998 with monitor and printer for somethings like $1500. This is like $3000 today. My kids have toys that are about $20 that are as powerful as it. I just bought a printer, copier, scanner, fax for $40. This is massive price deflation and it benefits the consumer.
I'm not sure where you learned about Austrian Economics. It doesn't place any expectations on people. That is the beauty of it. It makes you realize that all people with the exception of the truly insane are rational actors. They always do what is in their own best interest with the choices they have. You may not agree with them but it isn't your place to tell them how to live.
I don't blame my inability to convince my wife. We are equal partners in the relationship and she didn't want to sell our nice house to go live in a crappy rental for a few years while raising a young family. She had good points and I accepted them.
I'm glad we can agree that raising the minimum wage too high increases unemployment. And as we all know central planning works wonderfully and as long as we put the smart people in charge of our lives they can magically make everything better because they know exactly what the proper wage should be. Unless you are the poor guy who can't get a job.
If you raise the price of something you decrease the demand. If raising the minimum wage doesn't cause unemployment why not triple it? Why not make it $1m per hour. Then we would all be rich!!!!!!
All the minimum wage does is ban jobs that are worth less than it. Now there is going to be a natural minimum wage where you get full employment. If you make it higher than this wage people without enough skills to make their labor worth that wage will not be hired. Why would a business hire someone for $8/hr if they can only contribute $5/hr?
Now things can get confusing with inflation. If you have full employment it is a good indicator that the legal minimum wage is under the natural minimum wage. As the central banks create inflation like everything else the natural minimum wage will increase so in this environment you can increase the legal minimum wage and still keep it below the natural minimum wage while only causing some small increases in unemployment.
Just remember that productivity is the key. The whole country only produces so much stuff. Increasing the minimum wage doesn't make more stuff available. If anything if it is raised above the natural clearing price for wages than more people will be without work and less will be produced. With more money chasing less goods you get inflation.
I'm always going to hold some.gold. The dollar has lost 98% of its value since the federal reserve act. I doubt it is going to.improve much. If a real conservative gets in there and they slow down spending and raise interest rates it will defiantly make gold drop. But what are the odds of that?
Thanks for the advice. I have been selling gold slowly for the past few years. I actually use an investment strategy by Harry Borwne. It is called failsafe investing and you should be able to find a.pdf of it online. It's pretty simple.
Take your money and divide it in quarters. Put 1/4 in gold bullion or ETF 1/4 in Cash money market 1/4 in S&P 500 fund 1/4 in 25+ year bonds.
Then sit back. As you save add funds to the cash portion. If any part goes above 35% or below 15% of the portfolio rebalance. I've been using it since I got hosed in the dot com crash. Hey I was ony 22 at the time. I've averaged about a 15% return. What is good is that the rebalancing helps you buy low and sell high. Overall the S&P 500 hasn't done much in 10 years but I bought a bunch in 2008 when it fell so low. Now I didn't time the bottom but I got in below 800. And to buy it I had to sell some bonds which spiked for a while.
I am a mechanical engineer and I am asked to predict future events all the time. Things like what will the maximum load on a structure be, or will this part fail, ect. To someone untrained it may look like magic but there is science behind it.
As for economics you have to find the right version. I think the Austrain School provides the best insight. I think where you are getting confused is that peoples values are constantly changing and that is difficult to predict. Will they like the iPod or not. Those may be impossible to determine.
But there are many things that are perfectly understandable. When lots of money is created and put into the economy you know a bubble is going to occur. You cannot predict with certainty what sector this bubble will form but once it starts forming it is easy to see. Also if you raise minimum wage you know unemployment is going to increase. You may not know what exact people will be effected but you know the oval effect. When you make interest rates artificially low for certain things like mortgages and tuition you know malinvestment will flow into those industries.
A house can be an investment but it depends on prices. The big things to look at with local housing is what current rents and occupancy rates are, housing supply, and incomes. You have to remember that people always have and option to rent. So look at what the monthly cost of a house vs rents for comparables in the area. During the boom the purchase costs were much much higher in many areas. Plus there were plenty of rentals available. This means that the landlords can lower rents to get even more people into natal units if they want.
I've been reading about Austrian Economics for years and it has made me much better at understanding what is going on.
I have also saved myself quite a bit of money. While everyone was using their home like an ATM I was paying off that debt and buying gold. I wasn't able to convince my wife to sell the house and rent for 5 years but that is mostly because where I live the rental homes were not very nice. The brilliance of this book is that it takes the fact that humans act as the given. It doesn't try to push a moral code on how they act or judge them for not behaving the way the author thinks they should.
Slashdot Mirror
What is the purpose of patents? To provide a temporary monopoly on an idea. The main problem is that an idea is just a tiny fraction of the work required to bring something to market. Why reward just this one aspect? The market does a great job at rewarding good products. You can have 20 companies all working off the same idea come up with 20 different products. The question is who gets to determine who gets rewarded? Should it be whoever can get the idea before a panel of experts or should it be the consumer in the market?
Also the duration of the monopoly in a patent system is fixed. In the market the first to market enjoys a temporary monopoly until competitors catch up. If you have a truly innovative product it may take a long time for people to catch up.
What fu(&ing country do you live in? In the US we do not own our bodies. My body, if I can even call it mine, is owned by politicians, my neighbors, doctors, and pharmaceutical companies. They all prohibit me from dealing freely with people regarding what I can do with or put in my body.
What scares me the most is all of the people replying to you that think they have the right to decide if your wife's life is worth an extra year or two. The beauty of a free market is that you get to decide if it is worth it. Not to sound crass but would you give up cars, houses, retirements, ect to spend another year with her? I know in my case I would. These people write that a year isn't worth the resources. Who the hell are they to decide? It's like all of these socialists governments that give free healthcare, 1950s technology of course, and then run to a modern country when they get sick. You know because they are important. Any politician promoting universal healthcare should should only get their and their families healthcare at the VA.
At least get rid of the laws that prohibit doctors and dentists from publishing the price list.
I always thought it would be better to combine life insurance and health insurance. That way the interests of you and the company are both the same, your well being. Right now as a 40 year old guy I am ten years into a twenty year term policy for a million dollars. You would think if I get cancer my life insurer wouldn't mind paying a couple hundred grand to make sure I make it to the end of my policy.
So Central Planning will work if we can just get the right planners? I won't hold my breath.
That was a good article. It didn't refute anything I wrote. It just expanded on it and gave more detail of the accounting. The problem its it didn't go into the meaning of the system. The system still is designed to steal wealth from people that are productive for the benefit of the politicians, bankers, and other connected people.
Whoops. Good call. I meant 1988. I was a Freshman in Highschool.
There was inflation in Spain when they took the gold from the new world and during the gold rushes. But at least the people that did the work or conquering are the ones that benefited not some banker that gets to create it by legal privlage.
That is part of it also there's are legal tender laws. Look at your bills. This debt is legal tender for all debts public and private. This means if you owe me money I have to accept dollars. I can't say you have to pay me in gold or silver. If I refuse your payment the debt Can be called off by a court.
This is a silly post. Remember spending bills originate in the House. Here is your list with Congressional Control
Regan +9.3%
House Democrats
Senate Democrats until 1981
Senate Republican 1981-1987
George H. W. Bush +13.0%
House Democrats
Senate Democrats
Clinton -0.07%
House Democrats 1993-1994
House Republicans 1995-1997
Senate Democrats 1993-1994
Senate Republicans 1995-1997
Clinton -9.0%
House Republicans 1997-2000
Senate Republicans 1997-2000
George H. Bush +7.1%
House Republicans 2001-2004
Senate Democrats 2001-2002
Senate Republicans 2003-2004
George H. Bush +20.7%
House Republican 2005-2006
House Democrat 2007-2008
Senate Republican 2005-2006
Senate Democrat 2007-2008
So it seems that the only time there was a real decrease was the Republican Revolution of 1994 when they were fighting Clinton. Once Bush was elected and they had full majorities they started spending again. More complicated and interesting than you claim.
Based on this post you have no idea what you are talking about.
You have to go back 50 years to before money was hijacked by our current system of theft.
Money was a store of value that was commonly used in exchange. That's it. Most of the world used precious metals for various reasons. Copper, Silver, Gold, ect. The reason is because it was valued by people and was a compact store of value. It came into existence by mining and coining.
You have to look at how much money is in existence vs all other goods. If the ratio of money to goods is increasing then the money becomes worth less and price go up and you have inflation. If the ratio of money to goods is decreasing than money becomes worth more and prices go down and you have deflation. The beauty of this system is that you have a natural mechanism to control the money supply. When you have deflation and money becomes more valuable people find it profitable to go into money making (ie mining and coining). When you have inflation people find it more profitable to make goods. This keeps things in balance.
This all changed when we left the gold and silver standards in the 60's and 70's. This allowed them to print money with nothing backing it. You then have had constant inflation and the destruction of the dollar. Most of the problems today are the result of this system. It is designed to steal the wealth of the people and transfer it to the powerful and it is working perfectly.
Except in the TARP bill it allows the Federal Reserve to lower the reserve requirement to 0 if needed.
Very well written.
Most people think the way a bank works is they take money from depositors and lend it out and make money on the difference. Even if that were true it would be creating money because if the person saves money in a demand account (savings or checking) where they have access to it any time they want and the bank lends it out they have created money. Say I put $1000 in savings. My account shows I have $1000. Say the bank lends out $900 of it (Assuming there is a 10% reserve requirement which isn't even true anymore). There is now $1900 in the economy. It gets worse because when that person pays someone that $900 it goes into their bank and that bank can create $810. Now there is $2710 in the economy. This keeps going until there is $10,000. So the banks create $9,000 of money from that first $1000.
The key to this whole thing is letting banks lend out demand money. If we made this illegal the whole situation would change. Banks would only be allowed to lend out time deposits which are things like CD's where you give up access to the money for a certain time. This would prevent the bank from creating money because they could only lend out money that you don't have access to.
This could be accomplished without causing massive deflation by slowly raising reserve requirements.
The main reason deflation is bad is because today people have adjusted their lives based on debt and inflation. With deflation your wage goes down and you have problems paying off debts. But once transitioned to system where debt isn't money people do much better. You don't have to put your money at risk because you can just save it in a vault and it won't lose value. This I believe is why we have the current system. The powerful bankers and politicians like inflation because it allows them to spend money they don't have to tax to get. Also inflation forces you into the financial system so that your savings have a hope of maintaining purchasing power.
To think about deflation you have to look at the technology industry. This industry is growing so fast in productivity that it is still deflationary. Do people ever rush out to by a TV because they think it will be more expensive next year? Some people like the latest and greatest but most people wait for products to drop until they are in their price range. This is deflation. I bought an Apple II GS in 1998 with monitor and printer for somethings like $1500. This is like $3000 today. My kids have toys that are about $20 that are as powerful as it. I just bought a printer, copier, scanner, fax for $40. This is massive price deflation and it benefits the consumer.
I live in the South and have a 19 SEER variable speed AC/Heat Pump and this can't control it yet.
I'm not sure where you learned about Austrian Economics. It doesn't place any expectations on people. That is the beauty of it. It makes you realize that all people with the exception of the truly insane are rational actors. They always do what is in their own best interest with the choices they have. You may not agree with them but it isn't your place to tell them how to live.
I don't blame my inability to convince my wife. We are equal partners in the relationship and she didn't want to sell our nice house to go live in a crappy rental for a few years while raising a young family. She had good points and I accepted them.
I'm glad we can agree that raising the minimum wage too high increases unemployment. And as we all know central planning works wonderfully and as long as we put the smart people in charge of our lives they can magically make everything better because they know exactly what the proper wage should be. Unless you are the poor guy who can't get a job.
If you raise the price of something you decrease the demand. If raising the minimum wage doesn't cause unemployment why not triple it? Why not make it $1m per hour. Then we would all be rich!!!!!!
All the minimum wage does is ban jobs that are worth less than it. Now there is going to be a natural minimum wage where you get full employment. If you make it higher than this wage people without enough skills to make their labor worth that wage will not be hired. Why would a business hire someone for $8/hr if they can only contribute $5/hr?
Now things can get confusing with inflation. If you have full employment it is a good indicator that the legal minimum wage is under the natural minimum wage. As the central banks create inflation like everything else the natural minimum wage will increase so in this environment you can increase the legal minimum wage and still keep it below the natural minimum wage while only causing some small increases in unemployment.
Just remember that productivity is the key. The whole country only produces so much stuff. Increasing the minimum wage doesn't make more stuff available. If anything if it is raised above the natural clearing price for wages than more people will be without work and less will be produced. With more money chasing less goods you get inflation.
I'm always going to hold some.gold. The dollar has lost 98% of its value since the federal reserve act. I doubt it is going to.improve much. If a real conservative gets in there and they slow down spending and raise interest rates it will defiantly make gold drop. But what are the odds of that?
Thanks for the advice. I have been selling gold slowly for the past few years. I actually use an investment strategy by Harry Borwne. It is called failsafe investing and you should be able to find a .pdf of it online. It's pretty simple.
Take your money and divide it in quarters. Put
1/4 in gold bullion or ETF
1/4 in Cash money market
1/4 in S&P 500 fund
1/4 in 25+ year bonds.
Then sit back. As you save add funds to the cash portion. If any part goes above 35% or below 15% of the portfolio rebalance. I've been using it since I got hosed in the dot com crash. Hey I was ony 22 at the time. I've averaged about a 15% return. What is good is that the rebalancing helps you buy low and sell high. Overall the S&P 500 hasn't done much in 10 years but I bought a bunch in 2008 when it fell so low. Now I didn't time the bottom but I got in below 800. And to buy it I had to sell some bonds which spiked for a while.
They are wrong.
I am a mechanical engineer and I am asked to predict future events all the time. Things like what will the maximum load on a structure be, or will this part fail, ect. To someone untrained it may look like magic but there is science behind it.
As for economics you have to find the right version. I think the Austrain School provides the best insight. I think where you are getting confused is that peoples values are constantly changing and that is difficult to predict. Will they like the iPod or not. Those may be impossible to determine.
But there are many things that are perfectly understandable. When lots of money is created and put into the economy you know a bubble is going to occur. You cannot predict with certainty what sector this bubble will form but once it starts forming it is easy to see. Also if you raise minimum wage you know unemployment is going to increase. You may not know what exact people will be effected but you know the oval effect. When you make interest rates artificially low for certain things like mortgages and tuition you know malinvestment will flow into those industries.
A house can be an investment but it depends on prices. The big things to look at with local housing is what current rents and occupancy rates are, housing supply, and incomes. You have to remember that people always have and option to rent. So look at what the monthly cost of a house vs rents for comparables in the area. During the boom the purchase costs were much much higher in many areas. Plus there were plenty of rentals available. This means that the landlords can lower rents to get even more people into natal units if they want.
Here is the book you want to read if you want to learn economics that makes sense and has real predictive powers.
http://mises.org/Books/humanaction.pdf
I've been reading about Austrian Economics for years and it has made me much better at understanding what is going on.
I have also saved myself quite a bit of money. While everyone was using their home like an ATM I was paying off that debt and buying gold. I wasn't able to convince my wife to sell the house and rent for 5 years but that is mostly because where I live the rental homes were not very nice. The brilliance of this book is that it takes the fact that humans act as the given. It doesn't try to push a moral code on how they act or judge them for not behaving the way the author thinks they should.
Actually I am a mechanical desgin engineer. I have used statistical process control when designing and debugging automated production equipment.
You actually boiled it down wrong. Instead of spending so much time testing the kids, evaluate and help teachers improve their skills.